Captured Americans coping with life in a German POW camp in World War II are puzzled by the simplicity with which the Germans are able to stave off escape attempts, shooting those who try. Sefton (
William Holden) is a POW who has profitably wagered with his fellow American prisoners that these escapes would fail.
The POWs fear there may be an informer in their midst, but who is it? As it becomes clearer and clearer to his fellow inmates that Sefton has considerable contact with his German captors, his fellow POWs mistakenly conclude that he is the informer and they turn on him, including physically beating him and helping themselves to some of his belongings.
Sefton understands in full that to clear his name, he must determine the identity of the real informer, and he is, eventually, able to work out that Price (
Peter Graves), whose English is impeccable, is a German informant masquerading as an American POW. Written messages, Sefton discovers, are being smuggled by Price to the Germans through a hollow chess piece on the chessboard in the barracks, wth phony air raid drills staged to enable the Germans to retrieve these messages undetected.
Now realizing that Price has figured prominently in the death of the Americans that have attempted escape, Sefton plots revenge, and, after exposing Price's true identity to his fellow POWs, he maneuvers to force Price to make an unauthorized exit from the barracks. To the guards manning the tower, Price's exit looks like an American escape attempt, and they shoot him, much to the dismay of Stalag Commandant Von Scherbach (
Otto Preminger).
The diversion created by the shooting incident gives Sefton a chance to escape, and he takes with him a brave lieutenant (
Don Taylor) who has recently been captured. Because of the measures of success against the Germans he had gained prior to his capture, the lieutenant is a marked man, but he and Sefton are successful in their escape attempt.
The elimination of the German informer and the first successful escape by American POWs lift the spirits of the other POWs.
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A few days before Christmas, 1944, at the German prisoner-of-war camp, Stalag 17, two American POWs, Manfredi and Johnson, inmates of Barracks 4, are preparing an escape. The story's narrator, Cookie, one of the prisoners, suggests that there may be a traitor among the men of Barracks 4.
The men have secretly been digging a tunnel from their latrine to just beyond the barbed-wire fence that marks the perimeter of the camp. After going over their plan to sneak into Switzerland, Manfredi and Johnson get out of the barracks through a trap door hidden under the wood-burning stove and sneak into the latrine. They crawl through the tunnel and begin digging to the surface beyond the barbed wire fence.
Inside the barracks, the men speculate as to how long it will take their comrades to emerge beyond the fence. They begin to predict that the escapees will make it all the way when one of them, a shrewd man named Sefton, wagers two packs of cigarettes that the men won't even make it out of the nearby forest. The other men, most of whom dislike Sefton, wager against him.
Outside, Manfredi and Johnson dig to the surface and are about leave when they are spotted by a small German squad outside the fence, who open fire, killing them both. Inside the barracks, the remaining prisoners, including Sefton, are disheartened, knowing their buddies could not possibly have escaped. Sefton and his young assistant, Cookie (who narrates the story), quietly gather up the cigarettes that Sefton has won in the bet and store them in a footlocker Sefton keeps under his bed.
The next morning the entire camp is awakened for roll call. Barracks 4 is overseen by Sergeant Schultz, a jolly man whom the men have absolutely no trust for. In the camp's muster grounds, the men are addressed by the camp commandant, Oberst von Scherbach. Scherbach tells the men that his guards successfully prevented the escape from night before and that no man has ever escaped from his camp alive. He also has the corpses of Manfredi and Johnson lying in the mud and uncovered for all the men to see. The Barracks 4 chief, Hoffy, protests the treatment of the bodies and demands they have a proper burial. Von Scherbach agrees to do so. Von Scherbach goes on, saying that the stove in Barracks 4 will be removed so it cannot
Von Scherbach also announces that each barracks will be given a small Christmas tree and that all the prisoners will go through delousing. One of the prisoners, the shellshocked Joey, begins to play his ocarina, which is gently taken away by another prisoner, Stanislaus "Animal" Kazawa. While the commandant talks and uses a mocking tone, Animal throws the ocarina at the water in front of the commandant, splashing his polished boots with mud. The Commandant demands the guilty man step forward. Animal does and is followed moments later by several other men. Eventually, the entire prisoner population steps forward, covering for Animal. The Commandant, temporarily flustered, cancels the Christmas trees and tells the men they'll be deloused with cold water from the camp's fire hoses. The men are dismissed.
After the men have the opportunity to clean up in their latrines, and following a small incident where Animal is nearly shot for crossing the barbed-wire of the camp while lusting after Russian female prisoners, the men go back to their barracks for breakfast. Sefton fries himself an egg in front of the other prisoners and when questioned about how he paid for it, he tells them that he bartered for it using the cigarettes he'd won the night before. The other men are quite angry that Sefton would use cigarettes he'd gotten as a result of the deaths of their comrades, however, Sefton counters, saying that many other prisoners trade with the Germans and that life in the camp is such that thievery is common. One of the other prisoners, Duke, who has a short temper, tells Sefton that collusion with the Germans could get him hurt or killed and small fight breaks out. Hoffy promptly breaks it up and Sefton, claiming he has indigestion, gives the fried egg to Joey. Price, the barracks security officer, asks Sefton how he could be so sure that Manfredi and Johnson wouldn't make it to freedom. Sefton says he didn't know for sure but he "liked the odds" of the situation. Sefton also angrily tells his comrades that they're wasting their time and risking their lives unnecessarily by trying to escape. Sefton plans to ride out the war as a prisoner and stay alive.
The barracks of the camp share a ham radio that they keep hidden and use to listen to the BBC and other communications about the war. The radio is smuggled throughout the compound by Marko and his partner, Steve, who is on crutches having lost a leg in combat. They use his empty pantleg to hide various items, including the radio. When the radio is brought to Hoffy and Barracks 4, Marko tells them they can have it only for two days;traitor in their barracks known to the rest of the camp and the other barracks chiefs fear the radio will be discovered. The men set up the radio immediately, using a few yards of chicken wire as the antenna, which doubles as their volleyball net. One of the prisoners, Blondie, is a radio expert and begins to report about military actions in Europe; the news he picks up is about the famous Battle of the Bulge. Just then, Schultz arrives to seize the barracks stove and the radio is cleverly hidden in a pail of water. Hoffy and Duke try to grill Schultz about the barracks spy but Schultz refuses to tell them anything. Schultz also notices that a signal from the spy has been left for him; a loop has been tied in the cord for one of the bare light bulbs hanging from the rafters. After he barks orders for the men to leave, he goes to the chess board and takes the black queen. Pulling off the crown, he sees a small note rolled up and hidden inside. He exchanges the queen for an identical piece, pulls the loop out of the cord and walks out.
While the men uncover the tunnel they dug, they notice a horse-drawn cart going by with the coffins of Manfredi and Johnson. The men all remove their hats in respect. Cookie narrates for a while about Sefton himself, who, despite the poor conditions of the camp, has built a substantial entrepreneurship for himself based mostly on the trading of cigarettes. Sefton has several successful businesses at his disposal including distilling schnapps from potato peels, horse races (he uses mice that run around a small track), and a telescope that the men use to peek into the delousing shack in the Russian compound where female prisoners are disinfected. Hoffy, Price and Duke are not pleased with Sefton's ventures, fearing that the Germans will find out and punish them more harshly than ever.
A new prisoner arrives; Lieutenant James Dunbar, who is being housed at 17 until the Germans ship him to the officers camp. Dunbar is greeted warmheartedly by the rest of the barracks. However, there is instant friction between him and Sefton. Sefton tells everyone that Dunbar is from a wealthy family and should be pampered during his stay. While he talks,
company.